Briefing is complete and the matter is ripe for decision. Baxter State Bank, (1940) (holding that a federal court has authority to determine whether it has subject matter jurisdiction over a dispute). Rialto responds that when the conduct giving rise to the claims arose is not a factor in determining whether the cause of action has a close nexus to the bankruptcy plan. Therefore, the Court finds that the timing of the conduct alleged in the complaint is not a factor to be considered in determining whether there is a close nexus. The Court finds that notice was an insufficient substitute for specific reference of the claims in the Plan.
The Court has jurisdiction to determine whether it has subject matter jurisdiction over this adversary proceeding. The motion to dismiss for lack of subject matter jurisdiction is filed pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure, which is made applicable to this adversary proceeding by Rule 7012 of the Federal Rules of Bankruptcy Procedure. Proceedings arising in a case under title 11 refer to proceedings that are not based on any right expressly created by title 11, but nevertheless would have no existence outside the bankruptcy case. Maggio (In re Guild and Gallery Plus, Inc.), , 162 (3d Cir.2004). The confirmed Plan states that the "Bankruptcy Court shall retain jurisdiction... motions, adversary proceedings, contested matters, Causes of Action, and any other litigated matters instituted in the Chapter 11 Cases or on Behalf of the Debtors...." (Plan at § 10.1.b.) Also, the Plan defines the term "Causes of Action" to include "without limitation, any and all actions, causes of action, liabilities, Avoidance Actions, obligations, rights, suits, debts, sums of money, damages, judgments, Claims or proceedings to recover money or property and demands whatsoever, whether known or unknown, in law, equity or otherwise." (Id. While it may have put Rialto on notice, the rest of the creditors who voted on the Plan had no specific knowledge of the claims.
Dismissals: A Viable and Growing Alternative after Asset Sales by Norman Pernick and G. In still other cases, particularly those where one or more plan confirmation requirements cannot be met and a dismissal is not a useful alternative the parties should consider conversion to Chapter 7.
Before the Court is the Motion filed by the City of Rialto and Rialto Utility Authority (collectively "Rialto") to dismiss for lack of subject matter jurisdiction, abstain, or transfer venue of this adversary proceeding commenced by BWI Liquidating Trust ("the Plaintiff"), which asserts a claim for breach of contract of a Water Services Agreement ("WSA").
Under the WSA, the Debtors were responsible for designing and installing facilities for the treatment of groundwater from the Well that met water quality standards.
For example, there may not be sufficient unencumbered assets to fund the rest of the case, or there may not be enough assets to satisfy the various types of claims that must be paid in full in order to obtain confirmation.
In such circumstances a dismissal or as it is sometimes called a "structured dismissal" may make more sense.
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In sum, the proper retention of claims and causes of action in a plan not only protects a liquidating trustee from attack under res judicata but also may be necessary, depending on the jurisdiction, to confer jurisdiction on the bankruptcy court to hear and determine such claims and causes of actions under the bankruptcy court's "related to" jurisdiction.